Released: December 20, 2006

Phone firms await FCC cable ruling

Source: Alan Sipress, Washington Post (Free Registration)

Telephone companies could get a major boost today in their efforts to penetrate the cable television market when the Federal Communications Commission considers a measure that would give state and local officials less latitude in awarding cable franchises.

FCC Chairman Kevin J. Martin, a leading advocate of the rule, has argued that government officials often stymie competition by delaying decisions on awarding cable franchises to telephone companies and by imposing exorbitant fees and conditions. As a result, cable operators often have been able to maintain a virtual monopoly on television services, resulting in steadily increasing prices for consumers, according to Martin. He cited an FCC survey.

“Telephone companies are investing billions of dollars to upgrade their networks to provide video,’’ Martin said in a speech two weeks ago. “As the telephone companies and others began actively seeking to enter video markets in late 2004 and 2005, however, we began to hear from some providers that local authorities were making the process of getting franchises unreasonably difficult.”

Though the draft proposal will not be made public until today, it has already drawn sharp criticism from cable companies - which argue that it would unfairly penalize them - and local and state officials, who balk at efforts to curtail their authority in awarding franchises.

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